Elite Democracy: When Washington Reigned Supreme in Venezuela

When Hugo Chávez spoke at the United Nations last September, he accused Washington of promoting “elite democracy” in the world. Most people who heard the speech might not have realized what exactly he meant by the term “elite democracy”. Few people probably understood just how relevant his words were. But Chávez was speaking from personal experience.  Like much of the world, Venezuela has experienced the frustrations of an elite democracy and its devastating results. Chávez understands that in order to confront the crisis of modern democracy in the world, we must understand the tragedy that is elite democracy.

Throughout history, Washington has been dedicated to the exclusion of the masses and the prevention of true democracy. A long history of installing and supporting dictatorships in countries around the world is evidence enough of this. But when dictatorships become a public relations issue, Washington promotes a form of democracy of the elites, modeled after the system in the U.S., to pacify the population. Both dictatorship and elite democracy play the same role of preventing the “risk” of a truly democratic system. Whether through elite democracy, or dictatorship, the participation of the masses must be minimized.  Real democracy must never be allowed to function.

Venezuela is a perfect case study of how this Washington strategy functions. In the 20th century, Venezuela transitioned from dictatorship to elite democracy and, finally, to that other dictatorship known as neoliberalism. The transitions were carefully orchestrated by Washington and the Venezuelan elite.  The “risk” of true democracy was carefully avoided. Not suprisingly, U.S. corporations got exactly what they wanted from Venezuela; huge amounts of cheap oil and the best customer for U.S. goods in Latin America.

The brutal dictator and Washington ally, Marcos Pérez Jiménez, gave generous oil concessions to U.S. companies in the 1950’s, and, perhaps more importantly, further opened the door to U.S. imports.(1) Although this was very detrimental to Venezuelan national production and industry, U.S. companies and the Venezuelan elite class benefited greatly.  The resulting trade balance heavily favored the United States, as the oil money that Venezuela received was circulated back to the U.S. in the import of consumer goods. What more could the U.S. ask for? The system was serving them perfectly, just as long as the excluded majority in Venezuela was kept under control by the dictator and his state police; the infamous “National Security” goons.

But throughout the 1950’s, the opposition to the dictator was growing. The popular movement that developed to remove the dictator worried the United States. As usual, they were concerned about the the participation of the masses, and the radicalization of the popular movement.  Anti-americanism was so intense that Vice President Richard Nixon and his wife were almost killed by a Caracas mob in 1958.(2) Washington needed to assure that the people would not take control, that the popular will of the masses would not be exercised.

While the U.S. officially urged against the development of democratic institutions in the 1950’s, on the other hand, they maintained contact with the democratic opposition, cultivating the leaders to be friends of the the United States should they eventually come to power. Rómulo Bentancourt, the most famous opposition politician, was feared by Washington when he took power in 1946 because of his communist sympathies. But now he was being influenced by the State Department to ease his hostility towards the United States.(3)  Bentancourt, known in Venezuela as the “father of Venezuelan democracy,” was being taught the “acceptable limits” of democracy. Washington was showing him the ropes of the new system; elite democracy.

Elite Democracy: A “low-risk” democracy

Bentancourt became the next president of Venezuela after the fall of the dictator in 1958. But before open elections were held, the Venezuelan elite designed the new political system that would rule the country for the next forty years.  Built on political pacts, the system basically committed itself to avoiding all conflict, and therefore, maintaining the status quo in the country.  Many of the same business and elite leaders that had supported the dictatorship years earlier were now those who would design the new system.(4)

Bentancourt appeased the demands of the United States by outlawing communist and leftist parties. The result was a political pact, known as the Pact of Punto Fijo, between the two main parties that would share power equally between them, regardless of who won national elections. They agreed to avoid political conflict as well as structural change. The structure of the economy would not be changed and the institutions would be based on existing ones. As a result, large sectors of the political parties withdrew their support and resisted what they saw as elite rule. Venezuela was now supposedly a “democracy,” but Washington and the Venezuelan elite class had assured that meaningful change would not take place.

The coalition government resulted in a democracy within “limits.” A large portion of the population, and the political spectrum, was totally excluded. The formation of a common political and economic project between the two major parties meant that the worker and peasant classes would have to be contained; by force if necessary.  Since leftist parties were made illegal, they were forced to work underground; guerrilla armies formed around the country. The CIA was permitted to monitor leftist activities in the country. The military, trained and armed by the United States, violently repressed the leftist parties, killing and torturing thousands.

Little had changed from the days of the dictator. The participation of the masses was limited to choosing between two elite parties every few years. Apart from that, the rest was left to the elite politicians. Limited reforms and benefits would be offered to keep the masses complacent, but real structural change would not be possible.  Elite democracy had replaced the unpopular dictator, and Washington continued to have its way in Venezuela.

It is this form of elite democracy that Washington has promoted around the world, and continues to promote, though organisms like the National Endowment  for Democracy, USAID, and other covert means.  The basic idea is to put limits on the political system, restricting it to only those political programs that are not threatening to capitalist globalization. The strategy manages this by funding, training, and assisting political parties that are in Washington’s capitalist interests and undercutting any mass political movements that are working toward more fundamental changes.  Radical or revolutionary movements that demand any deeper change, or threaten the interests of global capital, are immediately opposed and impeded from taking power. Professor of Sociology at the University of California, William I. Robinson explains it as follows:

The masses may be demanding more radical and fundamental changes, but the elite work to redirect or neutralize these demands.  Just as earlier times in history, when the masses were considered too “ignorant” or “irresponsible” to be given any political power or to be consulted on national issues, in the modern age they are co-opted in more covert, clandestine ways. Whereas before the dictator would simply repress popular demands with violence, new sophisticated ways allowed the elite to repress them without confrontation. It was no longer acceptable to openly reject popular demands; now it was done privately.

In Venezuela, real democracy was much too “risky.” What would the masses do if they could exercise their will? Would they kick out U.S. oil companies? Would they restrict U.S. imports and investment to protect Venezuelan industry? Would they cooperate with U.S. enemies? For Washington and the Venezuelan elite, democracy was much too dangerous. Once again, it had to be prevented.

The Road to Neoliberalism: The world-wide dictatorship

During the dictatorship and years of elite democracy, U.S. corporations were able to gain a strong foothold in Venezuela. The dictator Pérez Jiménez had drastically opened the economy to U.S. imports, and the elites that followed him did nothing to change this. Since the priority was to avoid conflict and not step on the interests of the elite, neither a policy of protectionism nor liberalization was adopted. The coalition government took a middle road that ended up favoring imported production and weakening national industrialists.  Nascent Venezuelan production was obviously inferior to its U.S. counterpart and could not compete. Venezuelan national production lost ground to the U.S. importers, and that sector of the Venezuelan elite with ties to U.S. corporations came to dominate politics by the 1980’s.(6)  Elite businessmen came to realize that the way to survive was to invest in expanding U.S. and transnational expansion. Meanwhile, Venezuela became the most “Americanized” country in Latin America.

The conditions were set for neoliberal economic policies, and elite democracy had paved the way.  The consensus government had failed to build any significant Venezuelan industry or production; U.S. and multinational corporations had taken over.  The Venezuelan elite, lacking any loyalty to national interests, had jumped ship and joined the transnational capital class.  As U.S. culture and investment further penetrated the Venezuelan economy, it became more logical and effective to make alliances with transnational capital.(7)  Business associations, capitalist, investors, industrialists and professionals joined forces with foreign capital and, therefore, supported the neoliberal ideology.

President Carlos Andrés Pérez implemented the deadly economic policies of neoliberalism in 1989, with the consequence of massive urban riots, looting, and violence. Thousands were killed in the streets and in their houses by the national army. Throughout the years, oil income and loans had allowed the state to provide minimal social supports for the general population. But in the 1980’s, when oil prices dropped, and the national debt had reached an all time high, Pérez was forced to comply with the mandates of the international lenders; neoliberal economics. The result was a drastic increase in poverty and misery.(8)

Promoted by the United States and the corporate-dominated lending institutions, neoliberal policies force open the economies of the world to international investment. Governments must minimize intervention in the economy, and privatize services and resources.  The national budget must be dedicated to paying the debt. Everything else must be left up to the free market.  Healthcare, education, public services, and national resources are opened up to international investors. All restrictions on investment and the flow of international capital must be removed, as multinational corporations complete their domination of the national economy.

Chávez has referred to neoliberalism as a worldwide dictatorship.  This is perhaps a good characterization of its consequences, as nations are coerced into accepting certain policies. The World Bank and the International Monetary Fund dictate the terms. Any protections for local, national enterprises must be removed, as is all government intervention in the economy.  Governments surrender all control of state-owned resources to multinational capital.  National governments become irrelevant.  Multinational capital runs the show.

Since a nation’s citizens can only exercise their power over resources and the national economy by means of their government, reducing and privatizing the public sphere basically removes the only power a population has over their own society. The population is pushed out and excluded.  Investors, corporations, and capitalists alone make decisions about the services, the resources, and the economy. Elite domination is totally secured, removing all ways in which the population could possibly intervene.

It’s no wonder why Washington promotes and imposes neoliberal policies around the world. The goal in Venezuela and throughout the world has always been to prevent democracy, to shut the masses out of all decision-making. The neoliberal dictatorship is the perfect way to keep them permanently excluded, and ensures that all decisions will be made by the elite capitalist class. Just like under the dictatorships of earlier times, the people are spectators, not participants.

The plan almost worked in Venezuela, but the population stood up and fought back.  Venezuela is now the enemy, a threat to Washington, not because it is “undemocratic”, as they claim, but rather because it is democratic; not because Chávez is a dictator, but rather because he represents the majority.  Because now Venezuela is controlled by the people, not by a corporate dictatorship.
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(1) Ewell, Judith. Venezuela and the United States: From Monroe’s Hemisphere to Petroleum’s Empire. The University of Georgia Press, Athens, Georgia ©1996, pg. 177
(2) Ewell, pg. 165
(3) Ewell, pg. 162
(4) Coronil, Fernando. The Magical State: Nature, Money, And Modernity in Venezuela. The University of Chicago Press ©1997, pg. 226
(5) Robinson, William I. “Promoting Polyarchy: The New U.S. Political Intervention in Latin America,” published in ALAI, Latin America in Movement, 2006-02-17
(6) Coronil, pg. 188
(7) Ewell, pg. 166
(8) Fernando Coronil; Julie Skurski.  “Dismembering and Remembering the Nation: The Semantics of Political Violence in Venezuela, Comparative Studies in Society and History,” Vol. 33, No.2. (Apr., 1991), pp. 288-337